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Cite as
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Full Title
MANAGEMENT CONTROL
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Publisher
FrancoAngeli
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ISSN
2239-0391 (Printed Journal)
2239-4397 (Online Journal)
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Journal Issue Number
1
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Journal Issue Designation
1
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Journal Issue Date
2025
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Full Title
Exploring Business Resilience Through Financial Statements Analysis
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By (author)
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First Page
161
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Last Page
184
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Language of text
English
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Publication Date
2025/04
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Copyright
2025 FrancoAngeli srl
Main description
This study explores business resilience through a financial accounting lens. Business resilience refers to a firm's ability to anticipate and respond to crises, maintain operational continuity, and recover rapidly. In financial terms it is assessed by analyzing the variability of financial results. Resilience depends on various characteristics and capabilities, identified in the literature as drivers of resilience. These drivers represent the actionable levers to improve resilience capabilities and the elements that underline a company's resilience level. The drivers are often qualitative, making them difficult to assess objectively. Using a deductive approach and drawing on existing literature, this study develops logical connections between the drivers of business resilience and indexes of the financial results' variability. Informed by signalling theory, the research aims to address the concerns regarding the lack of practical methodologies to operationalize resilience in a way that is both actionable and useful in practice. The proposed conceptual scheme signals to managers information to shed lights, monitor and manage resilience both ex-ante (to inform decision-making) and ex-post (to evaluate past decisions). Additionally, it signals resilience capabilities to external stakeholders, thereby facilitating more informed decisions regarding an organization of interest. The conceptual scheme highlights the potential of financial statements to depict a company's assets, financial health, and economic performance but also to reveal its resilience capability. Accordingly, this study advocates for a broader use of traditional financial statement analysis as a tool for managerial decision-making.
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